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2.4.1.1. Financial assets at fair value through profit or loss<br />
This category has two sub-categories: financial assets held for trading, and those designated at fair<br />
value through profit of loss at inception.<br />
A financial asset is classified as held for trading if it is acquired or incurred principally for the purpose<br />
of selling or repurchasing in the near term or if it is part of a portfolio of identified instruments that<br />
are managed together and for which there is evidence of a recent actual pattern of short-term<br />
profit-taking.<br />
Financial assets are designated at fair value through profit or loss also when financial instruments,<br />
such as debt securities held, containing one or more embedded derivatives significantly modify the<br />
cash flows. Gains and losses arising from changes in the fair value of derivatives that are managed in<br />
conjunction with designated financial assets are included in 'net income from financial instruments<br />
designated at fair value through profit or loss'. Interest income and expense and dividend income<br />
and expenses on financial assets at fair value through profit or loss are included in “Net interest<br />
income” or “Dividend income”, respectively.<br />
2.4.1.2. Loans and receivables<br />
Loans and receivables are non-derivative financial assets with fixed or determinable payments that<br />
are not quoted in an active market, other than: (a) those that the entity intends to sell immediately<br />
or in the short term, which are classified as held for trading, and those that the entity upon initial<br />
recognition designates as at fair value through profit or loss; (b) those that the entity upon initial<br />
recognition designates as available for sale; or (c) those for which the holder may not recover<br />
substantially all of its initial investment, other than because of credit deterioration.<br />
2.4.1.3. Held to maturity financial assets<br />
Held to maturity financial assets are non-derivative instruments with fixed or determinable payments<br />
and fixed maturity that an entity undoubtedly intends and is able to hold to maturity.<br />
The Bank cannot classify any financial assets as held to maturity if the Bank has, during the current<br />
financial year or during the two preceding financial years, sold or reclassified more than an insignificant<br />
amount of held-to-maturity financial assets before maturity (more than insignificant in relation to the<br />
total amount of held-to-maturity investments) other than sales or reclassifications that:<br />
• are so close to maturity or the financial asset’s call date that changes in the market interest rate<br />
would not have a significant effect on the financial asset’s fair value;<br />
• occur after the Bank has collected substantially all of the financial asset’s original principal through<br />
scheduled payments or prepayments; or<br />
• are attributable to an isolated event that is beyond the Bank’s control, is non-recurring and could<br />
not have been reasonably anticipated by the Bank.<br />
Whenever sales or reclassifications of more than an insignificant amount of held-to-maturity<br />
investments do not meet any of the conditions from the preceding paragraph, any remaining heldto-maturity<br />
investments must be reclassified as available for sale.<br />
61<br />
<strong>Gorenjska</strong> <strong>banka</strong>, d. d., Kranj<br />
<strong>Annual</strong> <strong>Report</strong> 2011<br />
Financial <strong>Report</strong>
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